The sector of education is vastly growing day by day. Students do find it challenging to face certain realities such as increased fee structure and educational loan. They are sometimes puzzled to cope up with it. In these cases, educational loan can act as an aid to students in meeting their academic needs. It usually covers the expenses required to complete your course.
There are certain plus points in considering an educational loan, and some disadvantages as well. More often, while availing a loan, its advantages get marketed more forcibly and easily than the demerits. More than assisting a student, financial institutions majorly pound on hiking the profitability of their business. However, read on further to be aware of certain benefits and challenges of an educational loan.
What are the benefits of availing an educational loan?
It helps student to focus on career and join the course of his/her choice, in the preferred university or institution where he/she wishes to study.
The student can pay back the amount in installments to the lender, after completing the course, without much worry.
Since educational loan is a universal requirement all over the world, it can be availed in any or all the banks worldwide, via online application facility, making it an easy task for applicants. One may apply for the loan either by visiting the bank personally or by online application through the bank website.
The repayment process is pretty attractive in terms of facilitating the student to focus on studies first and then give time for the student to repay after he/she finishes the course and starts working.
It will help you to save income taxes during the time of repayment.
Interest rates are reasonable. Hence, without submitting any collateral, you will be getting the basic amount as agreed upon at the time of sanctioning the loan.
Few challenges of educational loan-
Proper knowledge on the fund must be given to the students at the time of granting the loan, which can hardly be noticed with banks. They promote the loan by widely talking about its benefits, but they rarely mention about its consequences or after-effects in the long run.
Taking an educational loan may lead to financial stress, if students do not get a proper job after their studies. Moreover, banks would not be able to provide complete assistance to the borrowers with repayment problems.
Most of the time, due to lack of appropriate knowledge, students get tricked into unsuitable educational loans. Therefore, it is very important for borrowers to plan the suitability of the loan in the long run, before it gets to unmanageable situations.
Surely, these loans may be the best answer to financial shortage. However, if planned wisely, the students can have a successful career along with its support. Else, there are chances of falling into terrible situation, with repayment burdens on your back.
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